Re: water pump/ tell tale issues
You have checked that the telltale is not blocked .
You are sure you have assembled the pump correctly and that the impeller drive key is in position?
You are sure that the water tube has entered the top of the water pump and that the grommet is in good condition if not new.
Did you connect a hose onto the water tube and make sure you could get a water flow through the engine power head and the telltale?
I would suspect a likely problem is that the grommet at the top of the water tube has been squeezed, by corrosion around it, until it has completely blocked off the top of the water tube.
It is problem I know only too well with my '84 6 hp

and I beleive the earlier 7.5 is exactly the same.
Unfortunately it requires the power head to be removed to access it.
Even when all that is sorted you may find the water passages in the cylinder head are blocked ... not had to unblock mine yet but I have seen pictures of them well blocked.